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Three main conclusions drawn from repairable first-party estimates on passenger cars from both DRP and non-DRP shops.
Mitchell International’s latest Industry Trends Report (ITR) for the first quarter of 2014 asks the question, "Do Lower Labor Rates Lead to More Repair?"
Greg Horn, vice president of industry relations, examined labor rates in
his feature article and came to three main conclusions from all
repairable first-party collision estimates on passenger cars in 2013 for
all 50 states:
- Lower labor rates do not mean additional operations written on the estimate
- Lower labor rates do mean more panel repairing occurs
- Lower labor rates does not translate into additional refinish hours
"The discussion of disparity in labor rates is always very lively, and the analysis of data and my fact-based conclusions draws many responses from collision repairers," said Horn. "The data we look at represents labor rates from shops that do and do not participate in direct repair programs, so it provides a thorough glance at rates in various states."
Labor rates are valuable for shop billing, and the statements are just one aspect of a shop’s interactions with its customers. The overall experience, which typically encompasses service delivery, shop quality, service and communications regarding a repair has an impact on a shop’s overall reputation. The bonus article, by Brian Doyle, customer experience product manager for Mitchell’s Auto Physical Damage Solutions, discusses the importance of a shop’s Net Promoter Score and how to effectively gauge customer loyalty.
Mitchell’s quarterly publication has served the auto physical damage and casualty industries for more than a decade and provides deep visibility into data-driven trends in the P&C market. It highlights Mitchell’s own proprietary data, along with
JD Power data, to give insights into market drivers that affect how
shops work and interact with customers, and outline how insurers can
reduce inefficiencies within various business processes.The complete report is available at www.mitchell.com/industry-trends-report.